Sony is in the process of acquiring FromSoftware, according to insiders - It was nice while it lasted, fellas

[Dom Cruise]

Difference though being Sony owns more and no official statement regarding Kadokawa and Nintendo having partnered
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Doesn't Michael Crichton reveal or at least theorize in the novel Rising Sun that all Japanese corporations are actually owned by the same group or at least have surprising ties with one another?

 

[Übertroon]

Doesn't Michael Crichton reveal or at least theorize in the novel Rising Sun that all Japanese corporations are actually owned by the same group or at least have surprising ties with one another?

It's called a cabal, and it's definitely a thing. Before and during WWII they were called the Zaibatsu. Today they're called the Keiretsu. Japan had a rather well established nobility and aristocracy, and which has remained in power even after the war. For example former Prime minister Shinzo Abe was the grandson of the Japanese governor of Manchukuo and munitions minister during the war. His wife was the daughter of a member of the Zaibatsu, and his political mentors included two former prime ministers and the daughter of Hideki Tojo. Japan never had something akin to the denazification campaign that Germany suffered. The same people have basically been in power since the meiji restoration

 

[The Demon Pimp of Razgriz]

That you think Sony needs to own the majority of Kadokawa for this to amount to anything is financial illiteracy, 5% is quite a lot in a publicly traded company, much larger than nintendo's share, and although Tencent has 7% there has been nothing to suggest Tencent is looking to acquire Fromsoft, unlike Sony who has worked with the company before, expressed the desire for working with them again, and currently having one of their studios use the proprietary engine of Fromsoft to remake Demon Souls and possibly remaking Bloodborne.

The thing is, there's really nothing to suggest that Sony is going to acquire FromSoftware either, other than this rumor. Sony hasn't worked with Fromsoftware since Bloodborne, and the Demon Souls remake was done by a completely different studio. Meanwhile, Tencent have literally been acquiring studios left and right, just throwing their money around, enough that it seems to have companies like Microsoft spooked. Tencent is buying up studios they have no relation to (like Funcom and Sumo Digital) for whatever it takes to do so, while investing in everything from PlatinumGames to Ubisoft. Them buying out FromSoftware is at least just as likely as Sony doing it. Stock ownership means nothing in this situation; a number of companies own stock and stock ownership would only matter is Sony was actually trying to buy the entirety of Kadokawa. They aren't; the rumor is that they are trying to buy FromSoftware, which is doubtful because Kadokawa owns it lock stock and barrel and its highly unlikely they would sell a successful subsidiary that is finding great critical and commercial success. It also wouldn't make much sense for FromSoftware, since a good chunk of their sales came from PC and Xbox, and they are now starting to support the Switch. They gain nothing from being owned by Sony, and actually lose out on sales in the long run.

What you're doing though is claiming that there's no evidence,

I mean, there is no evidence; just one analysts spreading rumors. Rumors like this come and go. There were rumors of Activision Blizzard buying out EA, Take-two, or Ubisoft. There have been rumors for years of companies like Apple buying up publishers, of EA buying up publishers, etc. Then you have deals like the Microsoft buying up AB deal that come literally out of nowhere with no warning. Its best to simply not get too invested in rumors like this.

You then try to dispute the circumstantial evidence because you make the false presumption that Sony's stake isn't considerable, and dismissing the official partnership completely.

In the grand scheme of things, it really isn't that considerable, especially when you consider the large number of companies that own similar amounts of stock.

Someone in this thread tried to claim that Kadokawa is too big and that Sony doesn't have the resources to buy Fromsoft. I simply pointed out that Sony is way larger than Kadokawa and have both a large stake in the company and a official partnership.

It isn't just a matter of size. All kinds of things go into deals like this and make Sony acquiring a company of that size unlikely, such as outstanding debt that both companies hold, how well Kadokawa's business would synergize with Sony's, etc. Sony just spent $4 billion just in acquiring Bungie. I doubt they will pull off another huge acquisition like that anytime soon. I'm expecting smaller, easier acquisitions of smaller studios, which is what the majority of their acquisitions have actually been.

 

[Übertroon]

The thing is, there's really nothing to suggest that Sony is going to acquire FromSoftware either

Except the timing. Sony has been courting FromSoftware for years, and both them and Microsoft is now looking to buy up what remains of triple A dev studios. Not to mention the partnership with Kadokawa made just last year which you have repeatedly chosen to dismiss because Tencent just happens to have a larger stock percentage as if that somehow invalidates the circumstance.

Sony hasn't worked with Fromsoftware since Bloodborne

Which is where you're wrong. The development of the Demon Souls remake was made with the approval of From Software and with an agreement where From Software would share their original work with Bluepoint to ensure that timing and coding in the game was as similar to the original project as possible, just as how Ueda had a advisory role when Bluepoint remade Shadow of the Colossus. While From Software haven't worked for Sony since Bloodborne, the two companies have had negotiations and deals in the period between then and now. If the rumors of Bluepoint working on a Bloodborne remake is true then Sony and From Software are likely still keeping those channels open.

I mean, there is no evidence; just one analysts spreading rumors

Sure, analysts have been wrong before. But you can't just outright dismiss the possibility either, especially with misconceptions like thinking Sony doesn't have the assets to buy From Software wherever people are getting that idea

In the grand scheme of things, it really isn't that considerable, especially when you consider the large number of companies that own similar amounts of stock.

What would you consider a small number then? The amount of companies with larger or equal ownership in Kadokawa can be counted on one hand. And among them only Sony has a official special relationship with the company.

Sony just spent $4 billion just in acquiring Bungie. I doubt they will pull off another huge acquisition like that anytime soon.

Now you're the one guessing. Considering Microsoft spent 7 billion in Bethesda and then 68 billion on activision-blizzard within a year with their equity three times the size of Sony there is no reason to assume that Sony can't spend a few billion more on From Software. It would be far more reasonable than the recent actions of Microsoft. Not seeing where you're getting the idea that Sony is somehow breaking the bank after buying Bungie.

 

[The Demon Pimp of Razgriz]

but you can't just outright dismiss the possibility either, especially with misconceptions like thinking Sony doesn't have the assets to buy From Software wherever people are getting that idea

I'm not completely dismissing the idea, but we've been around this block many times before. Rumors like this should be disbelieved as a general rule, so when they inevitably don't happen, you don't have to act surprised.

What would you consider a small number then? The amount of companies with larger or equal ownership in Kadokawa can be counted on one hand. And among them only Sony has a official special relationship with the company.

Anything in the single digits isn't worth writing home about. Companies invest in each other all the time and stock holdings that low aren't worth getting excited over. And Sony are pointedly NOT the only company with a Capital Alliance with Kadokawa. As I said before, CyberAgent entered a Capital Alliance at the exact same time, and even took the same amount of stock, and, more recently, Kadokawa entered a Capital Alliance with Tencent. Sony isn't all that special, in other words, and shouldn't be treated such.

Now you're the one guessing. Considering Microsoft spent 7 billion in Bethesda and then 68 billion on activision-blizzard within a year with their equity three times the size of Sony there is no reason to assume that Sony can't spend a few billion more on From Software. It would be far more reasonable than the recent actions of Microsoft. Not seeing where you're getting the idea that Sony is somehow breaking the bank after buying Bungie.

Sony and Microsoft aren't playing in remotely the same the league. Not even close. Microsoft could buy up half the video game industry and not notice with all the money they have just lying around. The only limit they really have is antitrust scrutiny and governments just saying "no". Sony spent the better part of two decades losing money and accumulating debt, have spent the last several years selling off divisions, subsidiaries and assets, and have multiple underperforming divisions already. If this is about competing with Microsoft, they've already lost in that department before they even started, as they just don't have the cash on hand to compete with them pound for pound.

 

[Übertroon]

I'm not completely dismissing the idea, but we've been around this block many times before. Rumors like this should be disbelieved as a general rule, so when they inevitably don't happen, you don't have to act surprised.


Anything in the single digits isn't worth writing home about. Companies invest in each other all the time and stock holdings that low aren't worth getting excited over. And Sony are pointedly NOT the only company with a Capital Alliance with Kadokawa. As I said before, CyberAgent entered a Capital Alliance at the exact same time, and even took the same amount of stock, and, more recently, Kadokawa entered a Capital Alliance with Tencent. Sony isn't all that special, in other words, and shouldn't be treated such.


Sony and Microsoft aren't playing in remotely the same the league. Not even close. Microsoft could buy up half the video game industry and not notice with all the money they have just lying around. The only limit they really have is antitrust scrutiny and governments just saying "no". Sony spent the better part of two decades losing money and accumulating debt, have spent the last several years selling off divisions, subsidiaries and assets, and have multiple underperforming divisions already. If this is about competing with Microsoft, they've already lost in that department before they even started, as they just don't have the cash on hand to compete with them pound for pound.

I don't know where you're getting the idea that Microsoft vastly outsizes Sony. Microsoft has just double the income and triple the equity. Yet has spent 15 times as much on aquiring Blizzard and Bethesda. Sony could easily spend another 4 billion dollars and still be way below Microsoft's expenditure adjusted for the difference in income and assets. To spend an equal percentage of their 2021 equity Sony could spend another 20 billion to match Microsofts expenditures

 

[The Demon Pimp of Razgriz]

I don't know where you're getting the idea that Microsoft vastly outsizes Sony. Microsoft has just double the income and triple the equity. Yet has spent 15 times as much on aquiring Blizzard and Bethesda. Sony could easily spend another 4 billion dollars and still be way below Microsoft's expenditure adjusted for the difference in income and assets. To spend an equal percentage of their 2021 equity Sony could spend another 20 billion to match Microsofts expenditures

In terms of total market cap, Microsoft is worth $2 trillion, while Sony is worth only $105 billion. Microsoft's revenue is $161 billion, more than Sony's entire value as a company. Its operating income is $70 billion, its net income $60.6 billion, total assets are $333.8 billion, and total equity $141.9 billion. Its global brand valuation is the third largest in the world. Sony's operating income is a measly $8.78 billion, its revenue is only $81.38 billion, its net income is $10.77 billion, its total assets $10.77 billion, and its total equity $50.83 billion. Its literally not even close.

 

[Übertroon]

In terms of total market cap, Microsoft is worth $2 trillion, while Sony is worth only $105 billion. Microsoft's revenue is $161 billion, more than Sony's entire value as a company. Its operating income is $70 billion, its net income $60.6 billion, total assets are $333.8 billion, and total equity $141.9 billion. Its global brand valuation is the third largest in the world. Sony's operating income is a measly $8.78 billion, its revenue is only $81.38 billion, its net income is $10.77 billion, its total assets $10.77 billion, and its total equity $50.83 billion. Its literally not even close.

Marketing cap only has importance to those looking to buy or invest into the company, so Microsoft's inflated worth has no bearing on their weigth when it comes to actual equity.
Which as you pointed out is 150 billion for Microsoft and 50 billion for Sony. Microsoft Revenue is 160 billion for Microsoft and "only" 80 billion for Sony. You should look into what net operating income is if you want to know why the gap is larger. In short Sony expends more of their assets back into operating expenditure, and also probably manages to hide some of their revenue by being a bank simultaneously as being a tech firm. There is certainly some accounting fuckery required to explain why Sony has since 2012 been closing the equity gap to Microsoft with a smaller income.

So again, Microsoft only has three times the equity to throw around. Market cap only becomes relevant if Microsoft decides to sell shares to fund their purchasing spree

 

[The Demon Pimp of Razgriz]

So again, Microsoft only has three times the equity to throw around.

You say that as if it means absolutely nothing. It means a hell of lot. Microsoft brings in has more assets, more cash on hand, better access to capital, and if they wanted to say:

sell shares to fund their purchasing spree

They could do that with minimal issue.

In terms of debt load, Sony actually has far more of it; Sony's total debt is $2.09 trillion, Microsoft's is only $63.33 billion. Microsoft's net debt is $49.75 billion, Sony's net debt is $305.88 billion.

As I said, Sony and Microsoft aren't even playing in the same league. Why you are trying to act like they are makes no sense to me.

 

[Urbanmech]

Has there been someone else besides the guy who tweeted it out that said FS is in sights RIGHT NOW? Kind of curious if the Tweeter just heard what he wanted to hear and the source said/meant FS was in Sony's sights , aka before Elden Rings drop.

 

[The Demon Pimp of Razgriz]

Has there been someone else besides the guy who tweeted it out that said FS is in sights RIGHT NOW? Kind of curious if the Tweeter just heard what he wanted to hear and the source said/meant FS was in Sony's sights , aka before Elden Rings drop.

No. As far as we know, there is a single source for this "rumor", that all the major sites are basically pushing, and that's analyst Serkin Toto.

 

[Sparky Lurker]

It happened, but not really:

https://www.gameinformer.com/2022/08/31/tencent-sony-collectively-acquire-30-percent-of-elden-ring-developer-from-software

Tencent, Sony Collectively Acquire 30 Percent Of Elden Ring Developer From Software​

The year of acquisitions and shareholding antics continues.
Just today, Chinese developer-publisher NetEase announced it was acquiring Detroit: Become Human dev Quantic Dream, and now, Sony Interactive Entertainment and Tencent have increased their stakes in From Software, the prolific developer behind the Dark Souls series and this year’s mega-hit, Elden Ring.
This news comes from Gematsu, which posted a press release from Kadokawa Corporation, the parent company behind From Software. It says that through third-party allotment, Sixjoy Hong Kong, a Tencent Holdings subsidiary, has purchased 16.25% of From Software’s shares, while SIE has acquired 14.09%. Despite this, Kadokawa Corporation is still the largest shareholder of From Software, holding 69.66% of the shares.
“Through the implementation of the fund procurement, From Software will aim to proactively invest in development of more powerful game IP for itself to strengthen From Software’s development capabilities and will seek to establish a framework that allows the expansion of the scope of its own publishing in the significantly growing global market,” a press release reads. “In addition to these purposes, for an increase of the number of users in the global market for game IP that From Software creates and develops, From Software decided to conduct the Third-Party Allotment to Sixjoy within the Tencent Group, which has strength in its capabilities to develop and deploy mobile games and other network technologies in the global market including China, and SIE within the Sony Group, which has strength in its capabilities to deploy IP in games, videos, and various other media in the global market, concurrently and separately.”

Sony has been busy this year with acquisitions. It revealed it was buying Bungie, the developer behind the Destiny series, for $3.6 billion earlier this year and then later announced it was acquiring Jade Raymond’s new studio, Haven Studios. And just this week, Sony acquired Savage Game Studios to bolster its PlayStation Studios Mobile Division. Elsewhere in the industry, NetEase announced it was acquiring Quantic Dream today. Earlier this year, Take-Two Interactive, the parent company behind the Grand Theft Auto series, announced it was acquiring mobile giant Zynga for nearly $13 billion. That was the largest video game acquisition in history for roughly a week when Microsoft announced it was acquiring Activision Blizzard for a colossal $68.7 billion.

 

[Rich Evans Ayypologist]

Yo, a 14% share is still pretty fucking big.

Tencent has recently reported its first-ever revenue decline in Q2 of this year (article, transcript), so there is a chance that the Sixjoy position gets partially liquidated if the shortfall continues.

 

[I.B. Niggin]

The world would be a better place without Tencent.